Wind Concerns Ontario is a province-wide advocacy organization whose mission is to provide information on the potential impact of industrial-scale wind power generation on the economy, human health, and the natural environment.

QP Briefing
April 15, 2014Grassroots group asks Marin to shine a light on wind power

A vocal anti-wind development group is calling on Ombudsman André Marin to investigate what it calls a “lack of transparency” in how renewable energy approvals are granted.

“Municipalities, in particular, are really getting fed up with being promised more say [over wind projects] but really things haven’t changed very much,” said Jane Wilson, spokeswoman for Wind Concerns Ontario.

By the time municipalities know about wind power projects coming to their region, many aspects of the build have already been determined, she told QP Briefing Monday. Couple that with a lack of full disclosure on projects approved by the Ministry of the Environment and municipal governments and citizen groups feel left out of decision-making, she said.

“When companies come in and start leasing land, there is no documentation, no engineering reports made available to anyone about where these projects are going to go,” Wilson said.

What’s more, she claims that projects “deemed complete” by the MOE often have not completed, submitted or made public all of the necessary documentation for where turbines or access roads will be located.

On April 8, her organization filed a six-page letter with Marin’s office suggesting he investigate the lack of transparency in the Renewable Energy Approval process. Marin received expanded powers under the new provincial accountability act.

The current permitting process is “placing many municipalities in an awkward situation relative to concerns being raised by their residents,” the letter stated.

Some of those concerns include:

The need for transparency and full disclosure in how projects are approved.
How renewable energy approvals are processed.
How the Environmental Review Tribunal conducts cases.

“We are requesting more stringent guidelines as to how companies should behave and in the case of documentation being provided by the developers, that complete really means complete,” Wilson said. “We are looking for the Ombudsman to say [to a wind company]: ‘The rules are the rules and here are the rules and what you should be doing.’ ”

And the rules governing renewable energy companies are changing. In a May, 2013, sop to anti-wind activists and angry municipalities, Energy Minister Bob Chiarelli introduced measures to give municipal governments greater say over if and how renewable projects operate in their backyards.

The feed-in-tariff program for large-scale developments was replaced with a competitive bidding process based on the idea that any company looking to secure a contract for wind development now has to possess municipal support for its plan. This is an increasingly tough sell when many Southern and Eastern Ontario townships are declaring themselves “unwilling hosts.”

Ultimately, Chiarelli’s FIT changes fell short of a veto over future wind developments near residential areas, which is what many communities are after.

Marin spokeswoman Linda Williamson told QP Briefing Monday the request from Wind Concerns Ontario has been received and is in the early stages of consideration. “As with any complaint we receive, our staff will assess it to determine whether or not an investigation is warranted.”

Marin has received dozens of complaints regarding wind turbines — such as noise and siting — but determined in 2009 and again in 2011 the issue did not deserve a special investigation, such as the one being requested now.

The Ombudsman currently has a full caseload, including investigations into over billing by Hydro One, the de-escalation of lethal force by police services and the lack of accessibility services for adults with developmental disabilities.

What spurred the decision by Ontario’s Finance Minister, Charles Sousa to announce on April 11, 2014 that the Ontario Government is appointing a council to “recommend ways to improve the efficiency and optimize the full value of Hydro One, Ontario Power Generation (OPG) and the Liquor Control Board of Ontario (LCBO”? Was it a sudden realization that Ontario had undervalued assets? Or, was it an attempt to deflect attention from the gas plant scandal?

I’m betting the latter. Why? The shareholder value of the first two Crown corporations listed have been continually interfered with by this government. Everything from “smart meters” to coal plant closures, multi-billion dollar tunnels, run-of river hydro and coal plant conversions (to biomass) have played a big role in the current value of both OPG and Hydro One. Add that to above-market rates for wind and solar developments, and billion dollar transmission spending to hook them to the grid—the only reason OPG and Hydro One have any value is that electricity rates in the monopolistic electricity sector have been allowed to rise by over 100%. Four Long-term Energy Plans in 11 years and several dozen “directives” on how the businesses should operate have done nothing to enhance the value of those two entities.

Under the benign governance of the Ontario Energy Board (whose role was eviscerated by the government), electricity prices have increased at an average annual rate over 10% and driven well paying jobs from the province, as a result. Creating value seems to have been overlooked in the process. Is this another “Council” that will present a report that will simply be ignored as in the past?

What does Sousa expect?

Already, I see problems: Minister Sousa seems unaware the Auditor General in his 2011 report noted that Ministerial (Energy) directives to contract for above market priced wind and solar generation were executed without a cost benefit analysis.

He is also either unaware or in direct conflict with his party’s Energy Minister, Bob Chiarelli, who, just two days before Sousa’s announcement said, “The government is not currently looking at the disposing of any of our energy companies.” So, why “enhance value” if there is no plan to sell? Was Premier Wynne aware of this conflict or did she endorse both positions hoping that the new council would confuse the issue, and the electorate? Perhaps the gambit is to gain credibility to reduce or freeze energy sector salaries, or force a change in the way pensions and benefits are paid, to enhance value?

As recently noted OPG, had 77% of their employees on the “2013 Sunshine list” and Hydro One 67%; both have unfunded positions in the pension and benefits programs. A council isn’t necessary to figure that out!

So exactly what is Minister Sousa expecting from the council? OPG and Hydro One are both taxpayer owned institutions with one (Hydro One) holding a monopoly on the transmission business and on distribution of electricity to one quarter of Ontario’s ratepayers. OPG on the other hand has seen its share of the generation market fall since the PC government split old Ontario Hydro into five entities.

The final annual report of Ontario Hydro had this to say about their contribution to Ontario’s electricity supply: “ OPG facilities now supply about 85% of the province’s electricity demand. Under an agreement with the provincial government, that proportion will be gradually reduced so that by about 2010, OPG will control no more than 35% of the province’s total supply options.”

By the end of 2013 (three years later than planned) OPG had come close to achieving the “agreement” with 16,229 MW of installed capacity compared to total Ontario capacity (per recently “revised” Long-Term Energy Plan) reported as 38,374 MW giving OPG about 42% “of the province’s total supply.” That OPG capacity of 42% produced 80.3 terawatts (TWh), equal to 57 % of Ontario’s demand in 2013 and in 1999 had produced 136.2 TWh equal to 85% of demand.

The bottom line

On the financial side, OPG’s first full year of operation (2000) generated a profit, net of PIL (payments in lieu of taxes), of $605 million; by 2013 their profit had fallen to $135 million. So, OPG, based on history reflects itself as a business in decline. OPG are also about to undergo costly retrofits of their nuclear plants which have traditionally gone over budget. If Ontario sold OPG at, say, a 12 times multiple on earnings, it would net them only $1.4 billion. The best the province could hope to generate in a sale of OPG would be its current book value of $8.3 billion, but any buyer would demand guarantees on pricing of generation of all capacity and a guarantee of grid rights to ensure production is purchased. What is good for wind, solar and gas plant generators would be demanded by any new private sector owners of OPG! One also suspects a buyer would seek to cover any anticipated cost overruns on existing projects including nuclear refurbishments, biomass conversions, etc. In other words, it is likely the “Council” will recommend keeping OPG—it may not be sellable!

Hydro One, on the other hand looks like the star with Net Profit (after PIL) of $803 million for 2013 up from $378 million in 2000 (+112%), while Gross Revenue (net of Power Purchased) increased from $1,728 million in 2000 to $3,054 million in 2013 (+77%), despite a drop in terawatts (TWh) transmitted. An increase in employees of 1,173 however is cause for concern in respect to the transmission and distribution businesses. If, as suggested by Jan Carr in an article in the Toronto Star, Hydro One gets split into two entities—transmission and distribution—the breakout (2012 year-end) in Net Profit for the “transmission” business is $488 million and for “distribution,” $258 million providing a Return on Equity (ROE) on the former of 18.1% and 12.5% on the latter. The Return on Revenue (RoR) would be 32.9% and 25.8% respectively and above the comparable at, say, Enbridge with an ROE of 12.8% and an RoR of 18.8%.

Assuming the Council will suggest the two Hydro One businesses be split and could generate say 12 times their earnings in a sale, Ontario might generate $9 billion. That would come from approximately $3 billion for the distribution side and $6 billion for the transmission business. The sale would generate a one-time gain of about $2.5 billion for the province, or less than 25% of the current budget deficit. The sale would cause grief for the Liberal Party from the unions within the Hydro One family and so might prove unpalatable.

I am betting the Finance Minister’s appointed “Council” will deliver bad news but probably not until after an election. This is simply another exercise to deflect from the numerous scandals and the mismanagement of the energy file overall that are sure to be the message from opposition parties in a provincial election campaign.

One of the issues that came up during last week’s cross-Province hydro bill protest was the debt retirement charge and why, like Ontario’s own version of Bleak House, it just goes on and on and on, and never seems to get paid off in full?

Parker Gallant has examined the books, the news releases, the ministerial pronouncements and more, and has the answer for you.

The Washington D.C.-based energy policy “think tank” the Institute for Energy Research (which receives no funding from either government or industry) has reported that Germany’s experience with “green” energy has been an economic failure.

This news story is doubly interesting when you consider that the maps associated with the new large renewable power projects procurement process show a “green light” for Eastern Ontario.

Farmers not sold on wind turbines, survey says

By Brandy Harrison

Farmers’ Forum

OTTAWA — While farmers are among the few who can directly benefit financially from hosting wind turbines, Eastern Ontario farmers are more likely to oppose than support them, a Farmers Forum survey shows.

In a random survey of 100 farmers at the Ottawa Valley Farm Show from March 11 to 13, nearly half — 48 per cent — disapproved of wind turbines. Another 29 per cent approved and the remaining 23 per cent said they were neutral.

But positions on the issue weren’t always clear cut. Even when farmers threw their lot in with one side of the debate or the other, their reasoning was peppered with pros and cons.

It’s in stark contrast to a Farmers Forum survey of 50 Western Ontario farmers at the London Farm Show in early March, where 58 per cent were strongly opposed to wind turbines. Farmers opposed outnumbered those who approved by nearly three-to-one.

The number of turbines reveal the difference: Of the 67 wind projects representing more than 1,200 turbines province-wide, almost all the turbines dot the landscape of Western Ontario. Only two projects are in Eastern Ontario, an 86-turbine project on Wolfe Island, south of Kingston, and another 10 turbines near Brinston, south of Winchester, which were completed in January.

Wind power is so controversial that 13 farmers polled at the farm show wanted to remain anonymous, unwilling to come out publicly as a supporter or a critic.

Nearly three-quarters of farmers who disapproved liked green energy in theory but panned turbines — and sometimes the Green Energy Act as a whole — as a too-costly, inefficient electricity source that’s driving up their power bill.

Eric VanDenBroek doesn’t mind the look of the turbines that are only a short drive from his Winchester dairy farm but isn’t a fan of the way the program was rolled out.

“A financial disaster”

“Financially, it’s already proving to be a disaster,” said VanDenBroek, who turned down a chance to get in on renewable revenue. “It’s costing taxpayers money and we don’t have a say in it. Anytime the government gets involved in something, the costs inflate.”

Doug Armstrong agreed. But the North Gower crop farmer may put one up on his own land, particularly if neighbours are considering doing the same.

“I’m not allergic to money. But to be quite honest, as far as I’m concerned, they’re a total and complete waste of money,” said Armstrong.

Turbines are ugly, said Elwood Quaile, who joked that Wolfe Island may one day levitate out of Lake Ontario. But his biggest beef is the expense compared to the return. “Especially when you have a whole lot of gosh-darn water generators sitting idle,” said the Navan crop farmer.

Higher per kilowatt costs make even less sense when excess energy is sold south of the border for less than it costs to produce it, said Bill Seymour.

“It’d be like me buying a Lamborghini for my farm. It’s really nice and sharp, but do the cost on it. Why would I do that?” asked the Lunenburg crop farmer.

Other reasons farmers disapproved included their appearance, adverse health effects, conflicts between farmers, lost farmland, decreasing land values, and that people have little say in where they go.

Among farmers ready to give wind turbines the go-ahead, just over two-thirds reasoned that there is a need for renewable energy.

“The wind blows. It’s free. How else can we make power out of something that’s free?” said Ivan Petersen, who runs an Osgoode crop, dairy, and elevator operation. Petersen has solar panels and also likes the additional income.

It’s a good idea but there are challenges, said a Peterborough-area farmer, who didn’t want to be named.

“For the farmer whose farm they’re on, it’s a great thing. For the farmer who’s next to him and gets nothing, it’s a bad thing,” he said, proposing a tax rebate to homeowners based on distance from the turbine. “Everybody wins. Then it’s not neighbour-against-neighbour.”

The debate isn’t rational and people are misinformed, said a Dundas County farmer, who approves but requested anonymity.

“People are willing to fight wind energy and still have a solar panel in their backyard, which is kind of hypocritical. You can’t have your cake and eat it too,” he said.

Other farmers approved in hopes of additional income, seeing a break on their energy bills, or out of a feeling that people can do what they like on their own property.

Many of the 23 farmers who remained neutral on the issue said they didn’t have enough information to take a firm stance, but they’d definitely heard the pros and cons.

“If it was making me money, I’d love ‘em. If it was keeping me up all night, I’d want to knock it down,” said Scott Kinlock, a Martintown crop farmer and custom operator.

Wind power approval ratings were high, however, in another Farmers Forum survey three years ago, where just over half of 200 Wolfe Island (pop. 1,200 in summer) residents polled approved of turbines. But nearly one-third of respondents said community spirit had plummeted since the turbines went up in 2009.

Large wind farms can knock as much as 12 per cent off the values of homes within a 2km radius, and reduce property prices as far as 14km away, according to research by the London School of Economics. The findings contrast sharply with a report by the Centre for Economics and Business Research (CEBR) in March, which found no negative impact on property prices within a 5km radius of a turbine.

The LSE findings will fan demands by homeowners for compensation when wind farm developments are given the go-ahead. Currently, wind farm operators pay rent on the land they occupy and make contributions to community causes, but are under no legal obligation to compensate homeowners for loss of value.

The report, “Gone with the wind: valuing the visual impacts of wind turbines through house prices”, by Professor Stephen Gibbons, found that “wind farm developments reduce prices in locations where the turbines are visible, relative to where they are not visible, and that the effects are causal”.

For the average sized windfarm, the price reduction is around 5-6 per cent for homes with a visible windfarm within 2km, falling to less than 2 per cent between 2-4km, and to near zero between 8-14km, which is at the limit of likely visibility. In areas close to windfarms, but where the turbines are not visible, the report found there was a small increase (around 2 per cent) in property prices.

Large wind farms cause the greatest decline in property prices. “As might be expected, large visible wind farms have much bigger impacts that extend over a wider area,” said Gibbons. “The largest wind farms (20+ turbines) reduce prices by 12 per cent within 2km, and reduce prices by small amounts right out to 14km (by around 1.5 per cent).”
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Read the full news story here.

Canada’s ‘sagging middle’ hurting the rest of Canada

With Quebec’s election over, we can turn to Ontario where a scandal-plagued Liberal government will soon present its 2014 budget – and possibly trigger a spring election. Ontario is sagging under the weight of monstrous public debt, uncompetitive energy prices and rising taxes. Given Ontario’s size, other regions of Canada are being hurt.

Ontario has only one way out: economic growth. Luckily, the American economic recovery will significantly benefit Ontario. However, it won’t be enough. The government needs to get its house in order.

Nor will growth come from expansionary public programs like the proposed Ontario pension plan. Forcing people to hold assets in a government-sponsored plan might be helpful to some but it will be just another form of new taxation for others, who are already have adequate savings for retirement.

Ontario’s growth has lagged the rest of Canada, averaging less than 1% annually since 2009. Employment since 2009 has increased by 375,000 but the employment rate has fallen to U.S.-levels of 61.4% as of March 2014, far less than Alberta’s at almost 70%.

Ontario‘s fiscal picture is also not pretty, with gross debt over $290-billion (net debt is $272-billion), requiring $10.6-billion in taxes to cover interest charges. This expense is enormous, about one-half of education expenditures.

The average Ontario debt interest rate is only 4% but interest rates are expected to rise within the next few years. Each point increase in interest rates will add at least another $3-billion in annual interest expense.

A new paper from Dr Alec Salt, Professor of Otolaryngology at Washington University, on infrasound produced by large-scale wind turbines, long-term effects of exposure to infrasound, and the quality of noise measurement being used by governments and industry. His conclusion is that: the time has come to acknowledge the problem and work to eliminate it. He also says the wind power development industry needs to be held to a higher standard of health and safety than it currently is. Read the paper2014 SaltLichtenhan Acoustics Today, and our thanks to Dr Alec salt for forwarding a PDF of the paper for us to share with you. Wind Concerns Ontario, in our continuing campaign to spark responsibility in the Ontario government for this burgeoning public health problem, will be forwarding the paper to the appropriate officials. Feel free to share it with your Member of Provincial Parliament.

Anti-turbine group says assessment falls short

A Plympton-Wyoming group opposing Suncor Energy’s plans to build a wind farm in their community says the company’s study of the potential impact on migrating tundra swans is inadequate. But, the company says it met provincial requirements in its application for environmental approval for the 46-turbine Cedar Point Wind Energy Project. That application is currently being reviewed by Ontario’s Ministry of Environment. “As part of the application for ministry approval, Suncor completed a natural heritage assessment to assess any potential impacts to significant habitat necessary to sustain wildlife, including birds,” said ministry spokesperson Kate Jordan. That assessment will be considered as part of the review, she said. “No decisions on the proposal has been made,”Jordan added. The group, We’re Against Industrial Turbines, Plympton-Wyoming (WAIT-PM,) has been going through Suncor’s application documents and issued a press release pointing to a one-day site observation report that included a swan count carried out in 2012. “I don’t think they gave an adequate look at it,” said WAIT-PW spokesperson Ingrid Willemsen. “I think they need to look at an appropriate time for migration, and see that they wouldn’t interfere with the flight patterns.” The Lambton Heritage Museum said Tuesday that thousands of swans could be seen in farm fields on the nearby former Thedford bog, a traditional stopover on the swans’ spring migration to nesting grounds in the Arctic.

This week, the United Nations’ Intergovernmental Panel on Climate Change (IPCC) is releasing its latest report, the “Working Group II Contribution to the Fifth Assessment Report.” Like its past reports, this one predicts apocalyptic consequences if mankind fails to give the UN the power to tax and regulate fossil fuels and subsidize and mandate the use of alternative fuels. But happily, an international group of scientists I have been privileged to work with has conducted an independent review of IPCC’s past and new reports, along with the climate science they deliberately exclude or misrepresent.

Our group, called the Nongovernmental International Panel on Climate Change (NIPCC), was founded in 2003 by a distinguished atmospheric physicist, S. Fred Singer, and has produced five hefty reports to date, the latest being released today(March 31).

So how do the IPCC and NIPCC reports differ? The final draft of the IPCC’s Summary for Policymakers identifies eight “reasons for concern” which media reports say will remain the focus of the final report. The NIPCC reports address each point too, also summarizing their authors’ positions in Summaries for Policymakers. This provides a convenient way to compare and contrast the reports’ findings.

Here’s what the reports say:

IPCC: “Risk of death, injury, and disrupted livelihoods in low-lying coastal zones and small island developing states, due to sea-level rise, coastal flooding, and storm surges.”

NIPCC: “Flood frequency and severity in many areas of the world were higher historically during the Little Ice Age and other cool eras than during the twentieth century. Climate change ranks well below other contributors, such as dikes and levee construction, to increased flooding.”

NIPCC: “There is little or no risk of increasing food insecurity due to global warming or rising atmospheric CO2levels. Farmers and others who depend on rural livelihoods for income are benefitting from rising agricultural productivity throughout the world, including in parts of Asia and Africa where the need for increased food supplies is most critical. Rising temperatures and atmospheric CO2levels play a key role in the realization of such benefits.

IPCC: “Risk of severe harm for large urban populations due to inland flooding.”

NIPCC: “No changes in precipitation patterns, snow, monsoons, or river flows that might be considered harmful to human well-being or plants or wildlife have been observed that could be attributed to rising CO2 levels. What changes have been observed tend to be beneficial.”

IPCC: “Risk of loss of rural livelihoods and income due to insufficient access to drinking and irrigation water and reduced agricultural productivity, particularly for farmers and pastoralists with minimal capital in semi-arid regions.”

NIPCC: “Higher atmospheric CO2concentrations benefit plant growth-promoting microorganisms that help land plants overcome drought conditions, a potentially negative aspect of future climate change. Continued atmospheric CO2 enrichment should prove to be a huge benefit to plants by directly enhancing their growth rates and water use efficiencies.”

IPCC: “Systemic risks due to extreme [weather] events leading to breakdown of infrastructure networks and critical services.”

NIPCC: “There is no support for the model-based projection that precipitation in a warming world becomes more variable and intense. …